Jay Castillo (@jay_castillo), Owner and founder of ForeclosurePhilippines.com
Castillo recalls, “If I can go back, I would tell my twenty year old self to start investing in real estate earlier, and I mean to really go out there and start buying properties wisely using the knowledge and know-how I have right now. The early 1990’s would have been a great time to start investing in real estate, and with what I know now, the possibilities are unbelievable!”
“Don’t get me wrong, I believe now is still a great time to invest, but imagine if I already knew how to properly choose good real estate investments, in the best locations, and I actually started buying those properties in those locations 20+ years ago, imagine how much they would be worth today!” Castillo said.
He adds, “I remember back then when I was always buying the Sunday edition of the Bulletin Today (now it’s called Manila Bulletin) to read the classified ads for job openings for programming/information technology related stuff (I was so obsessed with computers back then) … when I should have focused on the Acquired Assets section (those are listings of foreclosed properties for sale from banks). Yes, I remember I already saw those listings of foreclosed properties back then, but I never paid any attention to them.”
“And how I wish I could have done all of this when my dad was still around (He passed away in 1992). Looking back, I remember we didn’t really talk much, and we never talked about real estate, even if it was how he supported us after he retired from being a doctor/surgeon (he had rental properties in Caloocan). What better way to learn and get into real estate investing, than spending time with my Dad who has been doing it all along?” Castillo said.
Doris C. Dumlao (@Philbizwatcher), Senior Business Reporter at Philippine Daily Inquirer
“In your 20s, that’s when you usually gain employment for the first time. Sometimes you get too excited to use this newfound spending power and may be at risk of getting into heavy credit card debts. You don’t realize yet the consequence of having a bad credit history. It will take many years to rebuild creditworthiness. So I hope that many young people will avoid this mistake. The key is to live within your means, give yourself a good treat once in a while – see the world, hang out with friends – but avoid the debt trap. There will always be that cool new gadget or an exciting trip but if you have to borrow without enough cash flow to pay back, wait until such time that you do.” Dumlao said.
She adds, “The exception to this warning against borrowing is if you have a great idea for a start-up business and need access to external resources to start this. Some people have a knack at entrepreneurship and are willing to take risks. They may not succeed at the first crack (American chocolatier Milton Hershey set up businesses that went bankrupt four times before finally succeeding in a caramel venture funded by an aunt who mortgaged her house centuries ago) – but hey, for those who have the right temperament, there’s nothing better than being your own boss and creating job opportunities for others. Chances are, it will be difficult to borrow from a bank so most likely your parents or relatives will be your first funders. It’s also an option to take in business partners as well as mentors/angel investors.”
Dumlao explains, “For young adults still living under your parents’ roof, you have a lot of capacity to save, no matter how little your starting income is. A good buffer would be to have enough liquidity to allow you live independently for at least six months in case you lose your job. Then as your cash reserve grows beyond the imperative six-month buffer, it’s a pity if you just keep them in a savings account earning a meager interest that inflation only erodes. It’s time to look at investing in mutual funds or learning about the stock market. Invest to protect yourself against inflation, to pursue your goals and plan retirement early.”
Rose Fres Fausto, FQ Mom, author & PhilStar.com columnist (Raising Children with High FQ), www.RaisingPinoyBoys.com
Fausto reaches back beyond her 20s & recalls her knack for finances, “Looking back at my younger years, I’m pretty happy with what I’ve done in my financial journey. I started saving pretty early, as in as early as kindergarten! I was in college when I was 20 and I used my planner as my daily record for my expenses. So maybe I would say, “Just continue doing what you’ve been doing since kindergarten.”
“Back in my 20s I had most of my investments in fixed income instruments but that was okay because in those days, fixed income gave us double your money in 5 years, sometimes more. Maybe I’d suggest to my younger self to take a more aggressive position in equity for long-term investments, once she sees the fixed income returns going down. I’ll warn her that she will experience a roller coaster ride but just ‘keep calm and continue investing.’” Fausto said.
She playfully adds, “Well, knowing what I know now I’ll tell her exactly when to load up and when to sell the market!
“Seriously, I’ll always remind her to make sure what she does with and for money must always align with her core values; otherwise, no amount of money in this world would make her happy.” Fausto said.
Floi “Mr Investor” Wycoco (@floiwycoco), Founder of The Global Filipino Investor Inc. (https://tgfiph.com)
Wycoco shares his corporate life experience, “I got my first pay! Someone said, ‘Your first salary must go to your parents.’ So much for that advice, I just gave my mom Php1000 and the rest went to my spending. I was able to buy my Nokia phones and the other “In” gadgets in few months time. I was happy buying the things that I want. I had a ‘I work hard and I party harder mentality.’”
This cycle went on and he went bankrupt in no time.
Wycoco said, “If there’s one thing that I will advise to my 20 year old self, it’s knowing the difference between my WANTS and NEEDS. If I just realized this earlier, I could’ve been so much closer to attaining my goal of financial freedom.
Today, Wycoco is a financial advisor and an advocate of financial literacy through The Global Filipino Investor Inc. A complete 180-degree turn from “Mr. Spender” to “Mr. Investor”.
The irony wasn’t lost with him, “I’m now one of the few who look forward to reminding the eager new young professionals to prioritize building their wealth first before splurging on their wants. Lasty, to have a wealthier future you must know that it’s not how much you receive but it is how much you save and invest for your future that matters.”
Burn Gutierrez (@burngutierrez), Chairman of Angat Pilipinas Coalition for Financial Literacy, Inc. (https://www.pinoymundobiz.org)
Gutierrez recalls his days as a young musician and songwriter, ” I started playing in a band when I was 19. While all the other people involved in concerts were getting paid, we played for free most of the time. I even remember shelling out the little money left from my salary just to perform and “express” my musicality in front of 20 drunk people who are band members themselves. Those were the pay-for-play gigs that we now abhor. Those were the days when walking down the street was not a hobby but the only way to get home. Ironically, I was also the family’s breadwinner.”
He adds, “If I were to go back in time and meet my 20-year old self, I would tell him. ‘Hey dude, you better just save up your money, learn how to make it grow, stay healthy and away from smokers and drinkers and womanizers, so you can do whatever you REALLY want in the future. Your music career can wait. IF that is what you really want.’”
Gutierrez might have stopped with his musical career at the moment but his passion to share financial literacy kept him in the music scene. This time as a catalyst to educate artists and musicians on how to become financially-knowledgeable and prepared for their sunset years.
Aya Laraya (@pesosandsense), Founder and Creator of Pesos and Sense (https://pesosandsense.com)
Laraya said, “Having been in the (stock) market for quite a long-time, I have seen it evolve from a chaotic, 2-trading floor, manual system to today’s computerized, single trading floor entity. Hence, if I were given the chance to talk to my twenty-year old self I would simply offer the following advice — Peso-Cost Average a good company.”
Peso-Cost Average means buying stocks using a fixed amount of money (i.e. Php5000) at regular intervals (i.e. monthly) for a prolonged period of time.
“Why? Well if you look at the market’s history, you will see companies like Ayala Corp and PLDT consistently making money. Granted that they don’t always make money but they tend to show profits more often than not. So, shareholders of these firms have benefited from that track record over the past two decades.” Laraya said.
He adds, “Admittedly, this strategy will be boring and “simple” but that is exactly its appeal. A person doesn’t have to watch the market every day in order to benefit from its growth – this only requires discipline and commitment. This then means that my 20-year old self can explore other industries and opportunities and still benefit from the market’s growth over that period. And that I believe, would be a win-win for my 20-year old version.”
Sha Nacino (@ShaNacino), Author of “Money & Me” & Founder of SeminarPhilippines.com
Nacino tells her tale of the everyday struggle as a “corporate slave” and her journey towards making her passion her profession.
I loved everything about my employer — the culture, the management, my colleagues, our CSR activities, etc. — except for my job itself. I was doing a job that was not in line with my passions and skills. I wanted to resign but I couldn’t because my job was my only bread and butter.
Every day, I struggled to love my work and do my best at it. I saw my work as a sacrifice, a cross I had to carry every day until the day that I retire. Ouch! Every day, I would drag myself to work. I couldn’t count the days when I would cry on a Monday because it’s the beginning of work-week again.
“There are so many wonderful ways of putting food on the table. Why pick something which you don’t enjoy and you’re not skilled at?”
I was struck when I first heard this from Bo Sanchez.
What?! So there’s a way to do what I love to do and earn from it? I began to ask myself. It was an eye opener for me.
I then made a resolution to do something every day to eventually make my passion my profession. I read books. I sought mentors. I invested in my education. I also took charge of managing my finances well.
After 9 years of working as an employee, I finally quit my job. Today, I am pursuing my passions in writing and public speaking full time.
Everyday, I am excited to jump out of bed because there are so many things I want to do. For me, work is play. I am fully alive whenever I write and give talks. Later on, I got paid doing what I love to do! 🙂
It’s possible to do what you love to do, earn from it, and bless a lot of people in the process.
Make your passion your profession. This is the secret to sweet success and genuine happiness, I believe so!
I wish you success and happiness!
Laurent Dionisio, CPA, RFP®, Founder of PinoyFinancialPlanning.com
Dionisio recounts a lost opportunity that made him change his mind about investing, “I should be saving and investing as early as possible regardless of how much I was earning — even if it’s just 5% of my monthly income. I joined the workforce around 2007, yes, just before the 2008 market crash. Looking in hindsight, these were the best times to accumulate stocks because the market rallied in 2009 up to this date and making your money triple or more.”
Dionisio poses this question that most people in their 20s asks when confronted with the notion of investing, “ ‘How can I start saving and investing if I do not have excess cash?’ That would be my second advice. Simply live below (not within) your income or allowance. Avoid consumer loans like credit card debts and create that excess cash. In doing so, you’ll develop the habit of living simply and setting aside money for saving and investing which you will surely benefit from.”
Kendrick Chua (@kendrick_chua), RFP®
“Of all the lessons I learned in the past eight years of financial planning practice, perhaps the most invaluable advice I’d like to tell my younger self is: Invest with a clear objective.” Chua said.
He recalls his first time to invest invest in the stock market, “I was just 22 then, I dipped my hands into the stock market. The first half of 2007 was a bull run and everything the traders bought made money, including mine. I was on the lookout for the next Pacifica or Geograce. A stock (or two) that would give me jackpot! Because of this, I started chasing gains after gains, and with each chase meant a bigger amount invested. I forgot why I was investing in stocks already, or why I bought each particular stock.”
He adds, “When the market suddenly reversed, I found myself losing all the gains I made a year earlier. Worse, I had to liquidate (sell) most of my shares because I became fearful. I didn’t know it at the time, but in hindsight, it was actually the best opportunity to buy stocks. I was a newbie investor, and fear got the better of me.”
Chua explains, “If I only had a clear objective, I would not have invested blindly. Geograce, a stock I acquired back then, until now, is still 90% below my acquisition cost. I didn’t lose my shirt. A least I remember the adage, ‘Invest only the money you can afford to lose.’”
“Today, if an investment won’t serve my financial objective, I would forgo it no matter how tempting the potential returns are.” Chua said.
Now, over to you! Do you have some questions about money in your 20s? Go ahead and ask it in the comments section below.
Please share this with a 20-something friend you know. Heck, by the time they’re 30, they won’t be thinking of talking to their 20-year-old self – they’ll just be thanking you.
For help with financial management, read this: Financial Management: How to Manage Your Hard-Earned Money